Nick McKim (Tasmania, Australian Greens) Share this | Hansard source

I move:

That the Senate take note of the answer given by the Minister for Foreign Affairs (Senator Wong) to a question without notice I asked today relating to inflation.

There is a class war underway in this country. It's being waged by the RBA, and the Labor Party is sitting back and cheering them on. In fact, watching what's happened in the last year, it's hard to escape the conclusion that the board of the RBA are nothing more than stooges for the big corporations. In raising interest rates 12 times in just over 12 months the RBA is smashing mortgage holders and smashing renters for a problem they didn't cause.

Last week the OECD said that in Australia more than half of domestic inflation in 2022 was a result of profits. The OECD use the same method that The Australia Institute did and came to the same conclusion that The Australia Institute did. But, when The Australia Institute said publicly that profits were driving inflation, Treasury described their method as flawed and the RBA excused it away as mining and energy distorting the numbers. It's not flawed, and the OECD has shown that. It is an inconvenient truth—inconvenient for the RBA and inconvenient for the Labor Party. It's not just mining and energy; corporations with market power across the board, including supermarkets, are using the cover of supply shocks to drive up the cost of goods and increase their profits. But to admit that would be to admit that people's lives are being unnecessarily destroyed because the economic establishment is stuck in a groupthink that exists to serve and maintain corporate power.

To justify what the RBA is doing, its governor, Dr Lowe, is sounding more unhinged by the day. In just the last two weeks he has suggested that people find more work at the same time that he's aiming to put 130,000 more Australians out of work. He's suggested we need to increase productivity at the same time he's putting interest rates up, which makes it more expensive to invest in things that would improve productivity. He's suggesting that more supply is the answer to the housing crisis at the same time that he's driving building approvals to the lowest levels in over a decade, which is reducing new supply, which is pushing up rents and which is feeding into higher inflation—to which he then responds with even higher interest rates.

If he's sounding unhinged, it's because he can't utter the truth. And the truth, colleagues, is this: inflation is being driven by supply side shocks and corporate profiteering, overwhelmingly. But interest rate increases will do nothing about supply side shocks and won't stop corporate profiteering. Instead, interest rate increases are grinding millions of Australians into submission by forcing wage earners to accept cuts in real wages so that corporations can maintain or increase their profit margins by forcing small business to the wall, which means those very same organisations will gain evermore market power, which they can then abuse by putting up prices and by fuelling a massive transfer of wealth from renters and mortgage holders to landlords and the banks.

And what do we get from Labor? Complete and utter capitulation. The budget they handed down last month blithely accepts that 130,000 people will lose their jobs. The Labor Party has left tackling inflation to the RBA. The modern Labor Party has given up on economic justice because it is in the thrall of corporate power. If they had even the dimmest of memory of their roots they would be freezing rents, taxing super profits and the super rich, bringing in monopoly-busting divestiture powers, putting dental into Medicare, wiping student debt and raising income support. And Treasurer Jim Chalmers would step in and overrule the RBA and stop them putting up interest rates. That, colleagues, is what a genuinely progressive government would be doing. If only we had one.

Question agreed to.